[Federal Register Volume 62, Number 112 (Wednesday, June 11, 1997)]
[Proposed Rules]
[Pages 31777-31778]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-15315]


=======================================================================
-----------------------------------------------------------------------

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[DA 97-679]


Broadband PCS C and F Block Installment Payment Issues

AGENCY: Federal Communications Commission.

ACTION: Request for comments.

-----------------------------------------------------------------------

SUMMARY: On June 2, the Wireless Telecommunications Bureau (``Bureau'') 
of the Federal Communications Commission released a Public Notice 
requesting comment on broadband PCS C and F block installment payment 
issues. The Public Notice seeks comment on specific restructuring 
proposals, which are attached to the Public Notice as Appendices A 
through G. The Bureau invites any additional proposals for addressing 
broadband PCS C and F block financing terms. The Bureau also seeks 
comment on issues related to refund requests from licensees who 
submitted timely payments prior to the suspension of the installment 
payments. The Bureau plans to conduct a forum on broadband PCS C and F 
block installment payment issues, on June 30, 1997, in Washington, D.C.

DATES: Comments are due on or before June 23, 1997. Reply comments are 
due on or before July 8, 1997.

ADDRESSES: Secretary, Federal Communications Commission, 1919 M Street, 
N.W., Room 222, Washington, DC 20554. In addition, two copies should be 
hand delivered to: (1) Auctions and Industry Analysis Division, 
Wireless Telecommunications Bureau, Room 5322, 2025 M Street, N.W., 
Washington, D.C. 20554, Attention: Sande Taxali.

FOR FURTHER INFORMATION CONTACT: Rachel Kazan or Sande Taxali, Wireless 
Telecommunications Bureau, (202) 418-0660.

SUPPLEMENTARY INFORMATION: This is a summary of the Public Notice 
released on June 2, 1997. The complete Public Notice is available for 
inspection and copying during normal business hours in the FCC 
Reference Center (Room 239), 1919 M Street, N.W., Washington, D.C., 
20554, and also may be purchased from the Commission's copy contractor, 
International Transcription Services, (202) 857-3800, 2100 M Street, 
N.W., Washington, D.C. 20037. The complete Public Notice is also 
available on the Commission's Internet home page (http://www.fcc.gov).

Summary of the Public Notice

Wireless Telecommunications Bureau Seeks Comment on Broadband PCS C and 
F Block Installment Payment Issues

June 2, 1997.
Comment Due Date: June 23, 1997
Reply Comment Due Date: July 8, 1997

    1. The Wireless Telecommunications Bureau (``Bureau'') has received 
a request from several broadband Personal Communications Services 
(``PCS'') licensees requesting that the Commission modify the payment 
frequency for broadband PCS C and F block licensees from quarterly to 
annual installments. See Letter from Thomas Gutierrez, Esq., et al. to 
Michele C. Farquhar, Esq., Chief, Wireless Telecommunications Bureau 
(March 13, 1997) (``Gutierrez Letter''). Petitioners include Alpine 
PCS, Inc.; DCR PCS, Inc.; Eldorado Communications, L.L.C.; Indus, Inc.; 
KMTel L.L.C.; Mercury PCS, L.L.C.; Microcom Associates; NextWave 
Communications, Inc.; and R&S PCS, Inc. As a result of the pendency of 
this request and other issues regarding certain debt functions, the 
Bureau released an Order which suspended the deadline for broadband PCS 
C block installment payments. See Order, In the Matter of Installment 
Payments for PCS Licenses, DA 97-649 (released: March 31, 1997). PCS F 
block installment payments were later suspended as well. See Public 
Notice, ``FCC Announces Grant of Broadband Personal Communications 
Services D, E, and F Block Licenses,'' DA 97-883 (released: April 28, 
1997) at p. 2.
    2. The Bureau subsequently received several letters that propose 
alternative financing arrangements for broadband PCS C and F block 
licensees. See Letter from Leonard S. Sawicki, Director, FCC Affairs, 
MCI Telecommunications Corporation, to Mr. William F. Caton, Secretary, 
Federal Communications Commission (May 1, 1997) (``Sawicki Letter''). 
In this proposal, MCI requests that the Commission allow C block 
licensees to defer payment and accrue interest for the first five years 
of the license term. MCI also suggests that the Commission modify the 
PCS ownership and attribution rules to encourage additional investment 
in C block licensees. Finally, MCI suggests that such changes be 
available to all broadband PCS C block licensees. See also Letter from 
James H. Barker and Michael S. Wroblewski, Counsel to Fortunet 
Communications, L.P., to Mr. William F. Caton, Secretary, Federal 
Communications Commission (May 9, 1997) (``Barker Letter''). In its 
proposal, Fortunet requests that the Commission (1) suspend interest 
payments until year five of the license term; (2) extend the license 
term to 20 years; (3) modify the C block control group rules; (4) allow 
the transfer of C block licenses before the expiration of the five year 
holding period with modified unjust enrichment payments; and, (5) 
increase the level of foreign equity permitted. The Bureau also 
recently received a petition for rulemaking regarding the issue of 
broadband PCS C and F block payments. See Cook Inlet Region, Inc., 
Petition for Rulemaking, filed May 7, 1997 (RM-

[[Page 31778]]

9093). Cook Inlet requests that the Commission initiate a rulemaking to 
establish the requirements and procedures for the disposition of the 
installment payment obligations of Commission licensees who obtained 
their licenses by competitive bidding. Additionally, Cook Inlet 
requests that the Commission lift the stay of the deadline for 
broadband PCS C and F block installment payments. (``Cook Inlet 
Petition''). In order to consider which options would be most 
appropriate for a restructuring of broadband PCS C and F block debt, 
the Bureau seeks comment on the proposals received to date, as set 
forth in the Gutierrez Letter, the Sawicki Letter, the Barker Letter, 
and the Cook Inlet Petition. In addition, we note that other proposals 
have been informally raised with the Bureau. See, e.g., General 
Wireless Inc., Informal Proposal (May 6, 1997). In its proposal, 
General Wireless recommends that the Commission reduce the principal 
amount of its debt from an average C block price of $40/pop to $15/pop, 
consistent with A/B block prices. The Bureau seeks comment on whether 
PCS licensees would be able to prepay their installment debt if any 
such discount were to occur. Are there alternative proposals for 
calculating the present value of the broadband PCS C and F block debt 
to the government that would permit licensees to prepay the debt based 
on the net present value?
    3. The Bureau invites any additional proposals for addressing the C 
and F block broadband PCS financing terms. Comments received in 
response to this Public Notice will be incorporated into the record for 
the WT Docket No. 97-82 proceeding. Amendment of Part 1 of the 
Commission's Rules--Competitive Bidding Proceeding, Order, Memorandum 
Opinion and Order, and Notice of Proposed Rule Making, (62 FR 13540-
02). In this Notice of Proposed Rulemaking the Commission seeks comment 
on numerous installment payment issues, including various options for 
installment payments structures, and input on improvements in the 
installment payment program. Copies of the cited proposals are attached 
to this Public Notice as Appendices A through H. These proposals can 
also be found in the Wireless Telecommunications Bureau Reference Room, 
Room 5608, 2025 M Street, N.W., Washington D.C. 20554.
    4. In addition, the Bureau will hold a public forum to discuss the 
issues of C and F block restructuring and the current capital markets 
for financing these licenses. The Bureau plans to conduct the forum on 
June 30, 1997 in Washington, D.C. Further information concerning this 
event will be provided in a subsequent Public Notice.
    5. Finally, the Bureau has received numerous refund requests from 
licensees that submitted timely payments prior to the suspension of the 
installment payments. The Bureau seeks comment on whether these 
licensees should be offered any credit for the time value of their 
payments as a means to compensate these licensees for the cost of 
retaining their money during the period of payment suspension. See, 
e.g., Letter from Michael S. Wroblewski, Latham & Watkins, Counsel for 
Southeast Wireless Communications, L.P., to Regina Dorsey, Billings and 
Collections Branch, Office of Managing Director (April 7, 1997) 
(``Wroblewski Letter''); Letter from Sylvia Lesse, Kraskin & Lesse, 
LLP, for Comtel PCS Mainstreet Limited Partnership, to A. Jerome 
Fowlkes, Auctions Division, Wireless Telecommunications Bureau (April 
4, 1997) (``Lesse Letter''); Letter from Julia F. Kogan, Hogan & 
Hartson L.L.P., for Americall International LLC, to Linda King 
Friedman, Financial Operations Division, Office of Managing Director 
(April 2, 1997) (``Kogan Letter''). The Bureau seeks comment on how 
such compensation could be formulated.
    6. Parties should file comments on or before June 23, 1997 and 
replies to comments on or before July 8, 1997, with the Secretary, 
Federal Communications Commission, 1919 M Street, N.W., Room 222, 
Washington, DC 20554. In addition, two copies should be hand delivered 
to: (1) Auctions and Industry Analysis Division, Wireless 
Telecommunications Bureau, Room 5322, 2025 M Street, N.W., Washington, 
D.C. 20554, Attention: Sande Taxali. Copies of the petitions, comments, 
and reply comments may be obtained from the Commission's duplicating 
contractor, International Transcription Service, Inc. (ITS), 2100 M 
Street, N.W. Suite 140, Washington, D.C., 20037, (202) 857-3800. Copies 
are also available for public inspection during regular business hours 
in Room 5608, 2025 M Street, N.W., Washington, D.C. 20554. When 
requesting copies, please refer to DA-679.
    7. For further information contact Rachel Kazan or Sande Taxali, 
Auctions and Industry Analysis Division, Wireless Telecommunications 
Bureau at (202) 418-0660.

Federal Communications Commission.
William F. Caton,
Acting Secretary.
[FR Doc. 97-15315 Filed 6-10-97; 8:45 am]
BILLING CODE 6712-01-U